Brent-WTI Spread Widens To Over $8 As U.S. Gasoline Demand Slows
The spread between Brent crude oil prices and West Texas Intermediate (WTI) hit its widest level in over three years on Monday, with WTI down more than $8 compared to Brent as U.S. gasoline demand falls. Brent crude was trading at $104.8 on Monday at 11:41 EST, while WTI was trading at $96.12, representing a spread of over $8 per barrel. Brent crude futures closed at an $8.50 per barrel (bbl) premium to U.S. West Texas Intermediate (WTI) on Friday, the widest since June 2019 excluding spikes related to contract-expiry dates, Refinitiv data shows.
Brent prices continue to be boosted by tight physical supplies, buoyed by Russia’s war on Ukraine and Western sanctions, as well as a looming European Union ban on Russian oil set to be implemented before the end of this year.
In a note cited by Reuters, OANDA market analyst Jeffrey Halley said that while Brent is outperforming due to tight physical markets, “WTI, on the other hand, is a domestic benchmark meaning that U.S. recession nerves seem to be more heavily weighing on its price".
In the meantime, analysts are anticipating that the Federal Reserve will raise interest rates on Wednesday by three-fourths of a percentage point after June consumer prices gained 1.3%, notching 12-month inflation to an over-four-decade high of 9.1% largely due to the price of commodities.
Source: https://oilprice.com/Latest-Energy-News/World-News/Brent-WTI-Spread-Widens-To-Over-8-As-US-Gasoline-Demand-Slows.html, https://www.reuters.com/business/energy/brent-premium-wti-widest-since-mid-2019-2022-07-25/
OPEC+ Is Now 2.84 Million Bpd Below Its Oil Production Target
Opec+ members with crude production quotas hit an overall compliance rate of 320pc in June, up from 256pc in May, according to two delegates.
The group was 2.84mn b/d under its collective June production target, with compliance among Opec participants rising to 196pc from 236pc in May and conformity among non-Opec members increasing to 464pc from 360pc, one of the delegates said.
Opec+ achieves its monthly compliance rates using an average of output estimates provided by seven independent sources, including Argus. Argus' survey for June put total Opec+ compliance at 297pc, with Opec members and their non-Opec counterparts achieving a respective 213pc and 442pc.
Several members of the coalition are struggling to meet their targets, hampered by years of underinvestment, infrastructure issues, and sabotage. The compliance figures are also skewed by the impact of sanctions and custom boycotts on Russian production. Although Russia managed to raise its output by over 550,000 b/d last month, it was still 880,000 b/d below quota, according to Argus estimates.
2022-07-26